Executive Summary
Sales in the UK cash and carry sector increased from £8.65bn in 1992 to
£9.51bn in 1996. The sector competes with delivered wholesalers and mixed
businesses, to serve the smaller and independent grocery retailers and catering
sector in the UK. The strong performance of the food sector in particular, as
well as increased alcohol sales, have contributed to a rise in sales through
the grocery wholesalers in recent years. However, cash and carry operators'
share of this market has declined to 63.7%, as clients have switched to
delivered service, which offers additional facilities including credit.
The cash and carry sector can be segmented according to types of operation into
multiple depot operators, buying groups and independents. Multiple depot
operators account for the highest proportion of sales, led by the largest
companies, Booker PLC, Makro Self Service Wholesalers Ltd and Batleys PLC.
Buying groups, consortiums of wholesalers and retailers, are taking a rising
share of business as they allow members independence of operation, as well as
the strength of group membership. Both buying groups and multiples are able to
offer a range of own-label products to clients. There is also a small number of
independent unaffiliated depot operators in the industry, in some cases,
operating mixed businesses or specialist product mixes.
As smaller grocery retailers have evolved, a new pattern of trading focusing on
convenience lines, cigarettes and tobacco has emerged. This client base has
stabilised after considerable erosion, following intense competition from the
supermarkets. A new source of sales has also been steadily building from
caterers, which have experienced growing turnover in recent years.
Cash and carry groups continue to invest in their own-label products and
continue to look for more efficient ways of operating. A number of groups are
turning towards centralised distribution systems to cut costs and increase
control. Investment in computerisation and systems has also been strong. The
product mix is also under continuing review and these measures will contribute
towards steady trading for the sector in the short to medium term.
Thirteenth Edition 1997
Edited by Richard Caines
ISBN 1-85765-751-9
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